Thursday, January 30, 2014Last Update: 6:36 AM PT

In California, Water Is for Fighting

VALLEJO, Calif. (CN) - The city of Vallejo unfairly dumped upon nearby rural residents the entire cost of running its municipal water system, with decrepit pipes that will cost $30 million to fix, a landowners association claims in a class action. Claiming to represent 809 property owners in rural Napa and Solano Counties, Green Valley Landowners Association sued Vallejo in Solano County Superior Court, alleging breach of contract, and breach of faith and fiduciary duty. Vallejo, pop. 115,000, is on the northeast side of San Francisco Bay. Its municipal water system, Lakes Water System (LWS) was formed in the late 19th and early 20th centuries. "Over the years, defendant contractually agreed to allow approximately 809 non-resident families and property owners in rural Solano and Napa Counties to connect to the LWS and receive potable water," the complaint states. "For almost 100 years, the use and cost of operating the LWS was shared between defendant's residents and the nonresident customers of the LWS." The landowners association claims that Vallejo city residents paid 98 percent of the operating costs until 1992, when the city "unexpectedly and unilaterally breached its contractual and legal obligations to the nonresident customers of the LWS by passing an ordinance which required the approximately 809 non-resident families and property owners within the LWS to pay 100 percent of the cost of operating the LWS. Water rates for the nonresident customers skyrocketed as a result." This was followed by a similar ordinance in 2009, according to the lawsuit. "To compound this harm, for the first 100 years of its existence, defendant failed to maintain and replace the infrastructure within the LWS. As a result, not only were the 809 nonresidents forced to pay for the entire cost of operating a municipal water system, but the municipal water system forced upon them was terribly outdated and in need of immediate repair and replacement. Currently, the majority of the infrastructure within the LWS is 30 to 50 years or more beyond its useful life and in need of immediate replacement at an approximate cost of $24,000,000. Within the next decade, additional infrastructure will need to be replaced at an approximate cost of $6,000,000. Defendant intends to pass these deferred capital costs, plus the ordinary costs of operating the LWS, onto just 809 nonresident connections," the complaint states. The landowners association claims that most of the rural areas served by the LWS probably would not have been developed if not for the water promised under the breached agreement, due to lack of groundwater. Now those areas are saddled with maintenance of earthen dams, water treatment plants, miles of pipes and three reservoirs that the class claims are dangerous. "Because of the age of the pipe infrastructure within the LWS, defendant is unable to and will not allow others to test fire-fighting facilities within the LWS for fear that the extra water pressure generated by such a test would cause a failure of the pipes," the complaint states. The class claims that Vallejo reduced the water levels in three reservoirs and took one of them out of use altogether, which has caused the water quality in those reservoirs to fall below state and federal standards. In one long segment of pipe, the class claims, there are levels of organic chemical compounds called trihalomethanes (THMs) "which exceed or may exceed existing or new maximum contaminant levels under federal and state water quality regulations. THMs are regulated contaminants under federal and state drinking water regulations and their presence in drinking water is linked to liver, kidney and central nervous system problems and an increased risk of cancer." The class claims Vallejo intends to sell LWS infrastructure to a privately held utility and sell the reservoirs and watershed rights separately, and that Vallejo's appraisal of the infrastructure is inflated. "Defendant has engaged and is in the process of engaging in negotiations with more than one private, investor-owned utility to arrange a sale of the pipes, pumps, storage tanks and water treatment plant within the LWS ... [and] the inflated and flawed appraisal of the pipes, pumps, storage tanks and water treatment plant is being used as the basis for such negotiations," the complaint states. "Defendant will only consider selling the LWS to plaintiff (or a water district or service created by plaintiff) at a premium price of almost $3,000,000 over and above defendant's already flawed appraised value of the LWS." (Parentheses in complaint.) The landowners association seeks class certification and compensatory damages of at least $12 million, special damages to be determined, attorney fees and costs. It also seeks an injunction to stop Vallejo from selling all or any of the LWS during litigation, selling parts of the LWS without including the relevant real property in the sale, selling the LWS without investing the proceeds back into the LWS for improvements, continuing a surcharge fee, imposing rate structures in which Vallejo doesn't share the cost of maintaining the LWS, and specific performance of Vallejo's obligation to share the costs. The landowners association is represented by Stephen M. Flynn in San Francisco. A representative of the Vallejo City Attorney's Office was not available for comment Wednesday afternoon. California's water wars began even before statehood, causing Mark Twain to remark: "In California, whiskey is for drinking and water is for fighting." Twain also wrote that he fell into a California river once, and "came up all dusty."